My Actions Were Not Fraudulent, Says UBS "Rogue Trader"

Former UBS trader Kweku
Adoboli wept on Friday as he told a jury that his "off-book
trades" were done for the benefit of a bank that meant
everything to him.

Former UBS trader Kweku
Adoboli wept on Friday as he told a jury that his "off-book
trades" were done for the benefit of a bank that meant
everything to him.

Addressing the court for the first time since his trial
started six weeks ago, Adoboli said he believed his behaviour
was not fraudulent and he had worked incredibly hard for years
to generate profits.

"UBS was my family and every single thing I did, every
single bit of effort I put into that organisation, was for the
benefit of the bank," said Adoboli, his voice breaking as he
wept and thumped the witness box with his hand.

"That is everything I lived for ... To find yourself in
Wandsworth Prison for nine months because all you did was worked
so hard for this bank," he said through tears.

The 32-year-old British-educated Ghanaian was arrested on
Sept. 15, 2011, and blamed for losses of $2.3 billion. He was in
custody until he was granted bail in June 2012.

He has pleaded not guilty to two counts of fraud and four of
false accounting, covering the period between October 2008 and
September 2011.

The prosecution say Adoboli traded far in excess of his
authorised risk limits, concealed his unhedged positions by
booking fictitious hedges, and lied to the back office when
asked questions about his accounts.

Adoboli told the court that he had begun making what he
called "off-book trades" in late 2008 after realising that the
Exchange Traded Funds (ETFs) desk where he worked faced mounting
costs that would reduce any profits it could make.

Asked about his so-called trading "umbrella", which has been
the subject of intense scrutiny during the trial, Adoboli
described it as an accounting mechanism that had an legitimate
purpose.

He said it consisted of holding some trades off-book for a
period of time to try to generate a profit. Then those profits
would be leaked back into the profit and loss account to offset
costs incurred by the ETFs desk such as funding costs.

"The umbrella was one of the mechanisms we used. Ultimately
everybody knew about it," he said, becoming passionate as he
explained that it took a lot of hard work to generate the
profits kept in the umbrella.

Adoboli described the ETFs desk as over-stretched and
under-resourced. He referred to himself and John Hughes, the
only two traders on the desk initially, as "babies" and "kids"
dealing with a "massive" book.

He said that everything he did was to "make this book work".

CONFIDENT

The courtroom was packed as Adoboli entered the witness box,
wearing a dark suit and dark red tie. Most of the time he
appeared confident, speaking loudly and clearly as he answered
questions from his lawyer.

But on several occasions Adoboli became emotional.

He cried when his lawyer mentioned that his father had come
from Ghana and been present in the courtroom throughout the
long-running trial.

He cried again when talking about Mike Foster, who was in
charge of the ETFs desk when Adoboli joined it in 2006 and later
left UBS. Foster has been sitting next to Adoboli and advising
him and his lawyers for free throughout the trial.

"He wanted to make sure we could build something we could
all be proud of," Adoboli said, his voice choked with emotion,
after a long pause during which tears welled up and he was
unable to speak.

Describing how hard he had worked during the financial
crisis in 2008, when he said he had feared for the survival of
UBS, Adoboli cried again as he recalled that he had missed his
grandmother's funeral because of work commitments.

Prosecutors have portrayed Adoboli as a greedy,
out-of-control rogue trader who recklessly gambled away UBS's
money because he wanted to be a star of the trading floor and
earn bigger bonuses.

He said he had felt great loyalty towards UBS, where he
worked as an intern during his last summer as a university
student in 2002 and then started as a graduate trainee in 2003.
He spoke of pride and a sense of belonging and of the respect
and friendship he felt for many of his colleagues.

He said he had learned early in life a sense of
responsibility as he was oldest child and only son of a Ghanian
U.N. official who was often away on business, leaving him to
"look after" his mother and three sisters.

He grew up in Ghana, Israel and Syria, and from a young age
had acquired an early understanding of geopolitics, while his
education at a Quaker boarding school in northern England had
taught him "a lot of great values" about community, he said.